Wednesday, October 17, 2018

African swine fever case list

African swine fever continues to spread in China. Most new cases this month have been in Liaoning Province, and large farms with thousands of head have been infected. Today, the Ministry of Agriculture acknowledged the first case in Shanxi Province (although previous reports found infected meat in markets in Shanxi earlier this month). Below is a compilation of all the cases reported on the Ministry of Agriculture and Rural Affairs web site since August 1, 2018.

African swine fever cases reported by China Ministry of Agriculture and Rural Affairs (NR=not reported)
Month Day Province City Location Farm size
(head)
Sickened Mortality
Oct 17 Shanxi Datong Farm 15 7 4
Oct 16 Liaoning Panjin City Farm 161 43 43
Oct 15 Liaoning Tieling City Farmer co-op 6,640 50 14
Oct 15 Liaoning Tieling City Farm 4,323 1,030 1,030
Oct 15 Liaoning Tieling City Farm 3,223 31 20
Oct 14 Liaoning Jinzhou City Farm 19,938 221 221
Oct 14 Liaoning Jinzhou City Farm 1,571 109 109
Oct 14 Liaoning Jinzhou City Farm 270 129 129
Oct 14 Liaoning Anshan City Farm 180 14 14
Oct 12 Tianjin Yinzhou District Farm 639 292 189
Oct 12 Liaoning Anshan City Farm 120 88 72
Oct 11 Liaoning Dalian City Farm 1,353 20 11
Oct 8 Liaoning Anshan City Farm 460 160 160
Oct 7 Liaoning Yingkou City Farm 3,358 334 93
Sept 28 Liaoning Yingkou City Five farms 378 NR 102
Sept 28 Jilin Songyuan City Farm 44 8 3
Sept 22 Inner Mongolia Hohhot Slaughterhouse 388 4 2
Sept 17 Jilin Gongzhuling Farm 484 56 56
Sept 17 Inner Mongolia Xing'an League Farm 138 23 22
Sept 15 Inner Mongolia Xilin Gol League Farm 159 14 8
Sept 12 Inner Mongolia Abaqi Banner Farm NR 16 16
Sept 12 Henan Jiaxian County Farm NR 148 64
Sept 12 Inner Mongolia Xilin Gol League Farm NR 16 16
Sept 12 Henan Xinxiang City Farm NR 148 64
Sept 10 Anhui Tongling City Farm 219 63 23
Sept 6 Heilongjiang Jiamusi City Farm 203 26 10
Sept 6 Anhui Wuhu City Farm 30 13 4
Sept 6 Anhui Xuancheng City Farm 52 15 15
Sept 6 Anhui Quzhou City Farm 886 62 22
Sept 5 Heilongjiang Jiamusi City Farm 87 39 12
Sept 3 Jiangsu Wuxi City Farm 97 12 9
Sept 3 Anhui Xuancheng City Farm 308 152 83
Sept 2 Anhui Xuancheng City Farm 285 NR 40
Sept 2 Anhui Xuancheng City Farm 440 NR 94
Aug 29 Anhui Wuhu City Farm 459 185 80
Aug 17 Zhejiang Wenzhou City 3 Farmers NR 430 340
Aug 15 Jiangsu Lianyungang Farm NR 615 88
Aug 14 Henan Zhengzhou Slaughterhouse 260 30 30
Aug 1 Liaoning Shenyang City farm 383 47 47

China Wheat Sales Plunge; Reserves Auctioned

Chinese farmers' wheat sales were down 30 percent this year, but the State Administration of Grain and Commodity Reserves says not to worry because there are plenty of reserves. Authorities plan to offer 2 million metric tons of wheat reserves for sale weekly to ensure stable supplies, but results of the first auction were underwhelming.

Grain Administration statistics say a total of 50.15 mmt was procured from this year's wheat harvest as of September 30, 2018, the end of the main procurement season. That was 21.9 mmt less--about 30% less--than the volume of wheat procured during 2017. By comparison, the National Bureau of Statistics estimated that wheat production was 128.35 mmt, down 2.4% from last year. If these numbers are both true, farmers have sold less than 40% of the wheat they produced.
 
China 2018 wheat procurement
Province 2018 volume change from 2017

Million metric tons
Henan 12.065 -10.97
Jiangsu 10.207 -2.212
Shandong 9.274 -1.574
Anhui 5.325 -4.566
Hebei 4.698 -1.094
Hubei 1.605 -0.916
Total 50.152 -21.907

The Grain Reserve Administration explains that the sharp drop in wheat sales is due to a combination of policy reforms and weather factors. This year the minimum price procurement program was reformed to make policy-type procurement a supplement--not the primary marketing channel for wheat. The Reserve Administration says 90% of wheat sales this year were to "marketized" purchasers (not to government granaries), up 30 percentage points from last year. Consequently, farmers are holding their wheat longer and have retained a higher proportion of wheat beyond September 30 than usual.

The Administration also attributes the decline in sales to lower production and poor quality of this year's wheat harvest in Hubei, Anhui, and Henan Province. The Reserve administration says farmers in these regions have retained much of their wheat to use as animal feed or sold it to neighbors for that purpose. Statistics show that wheat sales were down nearly half in Henan, the biggest wheat-producing province, and in Anhui.

The Administration said that wheat prices are stable and a rational price premium of 10% or so has emerged for quality wheat. The Administration emphasizes that imports of wheat from Canada and Australia are used to mix with domestic wheat, imports are "small," and China has a high degree of self-sufficiency. Last year's imports of 4.4 mmt equaled 3% of consumption, the Administration said. Wheat imports for January-August 2018 totaled 2.23 mmt, down 1 mmt.

[This blog notes that the 2017 imports of 4.4 mmt would have equaled 6% of the volume of wheat that actually entered formal marketing channels.]

While the Administration insists that the poor quality wheat crop had minimal effect on supply and demand, it nevertheless announces that auctions of wheat from reserves have been resumed this week to ensure stable supplies and stable prices. Plans are to offer 2 mmt of reserve wheat for auction each week.

The first auction on October 10 sold 143,629 mt of the nearly 2 mmt offered, at an average price of 2,427 yuan/mt (about $353/mt). The wheat was from 2013, 2014, and 2015.

Sunday, October 14, 2018

China Sept Soybean Imports 8mmt

China's September imports of soybeans and other agricultural products were relatively steady, and the market-year total was slightly ahead of last year's. But Brazil's supply of soybeans is entering its seasonal lull.

The value of September agricultural imports reported by China Customs was $11.8 billion, down from $12.7 billion in August, but 8.8% more than the $10.66 billion imported a year ago during September 2017. September soybean imports were valued at $3.43 billion, down from nearly $4 billion in August but slightly ahead of the $3.3 billion value from a year earlier.


The volume of soybean imports totaled 8 million metric tons during September, down from 9.15 mmt imported during August, but nearly identical to the volume imported a year earlier. According to customs statistics, the 12-month import total for October 2017-September 2018 was 94 million metric tons, up from 93.5 mmt during 2016/17.


The average value of soybean imports per metric ton actually fell slightly during September. The average $428 per metric ton was down from $433 in August, but about 5% higher than a year earlier.
Meanwhile, Brazilian customs data show that China got 55 mmt of the 69 mmt of soybeans Brazil exported during January-September 2018. In August (which would roughly correspond to China's September imports) Brazil exported 6.9 mmt of soybeans to China. Brazil's soybean exports to China fell to 4.2 mmt in September as Brazil's supplies started to run low.

Chinese market commentary has noted that Brazilian prices quoted to Chinese importers have started to rise in recent weeks. U.S. soybean prices have fallen low enough to be roughly comparable to Brazilian prices after assessing China's 25% retaliatory tariff on the U.S. beans. On October 12, the National Grain and Oils Information Center estimated that the CNF price of Brazilian soybeans for arrival in China was $465/mt, about 25% higher than the $348/mt CNF price for soybeans from the U.S. Gulf of Mexico. After adding tariffs, value added tax, and unloading fees, Brazilian beans would cost RMB 3708/mt and U.S. Gulf beans would cost RMB 3666/mt.

Chinese commentators agree that the November-January months will be the key period for determining how China's soybean and soybean meal markets are able to withstand the impacts of trade tensions with the United States. One commentator foresees a soybean supply deficit of "about 10 million metric tons."


Soybean meal stocks in China are reported to be at a comfortable level, but speculation about the prospects for supply and demand in coming months has driven cash prices up. According to quotes posted on ncpqh.com, soybean meal prices on October 12 were up 11% higher from a month earlier. The November-January months are typically peak production months as livestock producers gear up for the winter holidays. However, this year there is much uncertainty about how African Swine Fever will affect swine production.

Monday, October 8, 2018

African Swine Fever: Quarantines Lifted, New Cases, Bad Behavior

China's Ministry of Agriculture and Rural Affairs has lifted lockdowns on swine movements in three districts where African Swine Fever was discovered in early August, but new cases have appeared elsewhere. About a dozen local officials, traders and farm managers have been arrested or investigated for knowingly selling infected animals and falsifying health certificates. New incidents reveal that pigs are routinely shipped long distances, increasing the chances that the virus may be spreading far and wide.

On September 29 the Ministry lifted a ban on movement of pigs from Shenyang (Liaoning Province), having found no further presence of African Swine Fever after six weeks of surveillance. Bans were lifted on September 30 for Zhengzhou (Henan Province), and October 3 for Lianyungang (Jiangsu Province).

One September 28, new cases of ASF were confirmed on a small farm of 44 pigs in Jilin Province's Songyuan City, Changling County--8 pigs were sickened and 3 died. On the same day, an outbreak was confirmed on five farms holding 378 pigs (102 died) in Yingkou, a port city in Liaoning Province 2 hours south of Shenyang. A second outbreak in Yingkou was confirmed October 7 on a farm holding 3358 pigs (334 were sickened and 93 died).

On September 28, authorities in Shanxi Province's Pingyao County (about 1,250 km from Shenyang) said they discovered the ASF virus in pork from pigs transported from Liaoning Province. County officials said they found no evidence of the virus in local pigs. In Shanxi's Jiexiu City there were also rumors that pork infected with ASF was found in a food shop, but this does not appear to have been confirmed by testing. The Ministry has not announced the Shanxi cases.

On October 8, Jiexiu City issued a notice calling for culling pigs fed on waste from restaurants, hotels and cafeterias to prevent spread of disease.
Update: On October 9, MARA announced a new case of ASF confirmed on a 360-pig farm in Liaoning, Anshan City, Tai'an County, 160 were sickened and 160 died.

On September 29, the Ministry of Agriculture and Rural Affairs announced that farmers and traders had transported diseased hogs and some local officials had issued fraudulent health certificates and failed to adequately monitor the virus. The Ministry listed six cases under investigation and warned officials to properly carry out their duties.
  • On August 11, the manager of a breeding farm and a hog trader in Heilongjiang Province's Jiamusi City transported a load of 253 hogs infected with the ASF virus to a Shuanghui processing plant in Henan Province's Zhengzhou. Veterinary officials provided false certificates and ear tags. 
  • On July 30, a load of 248 hogs were transported from Jilin province's Siping City to a slaughter facility in Zhucheng, Shandong Province. A veterinary official at a highway checkpoint in Lishu county of Jilin illegally issued a health certificate. 
  • In June, a farmer in Jun'nan District of Shenyang purchased 100 piglets from a trader in Jilin Province. After some died of disease, the farmer sold 45 pigs to another farmer in Shenyang New District. These pigs were the first ASF case reported on August 2. 
  • In Shenyang's Faku County, two officials issued animal health certificates outside their region of responsibility, making it difficult to trace the virus.
  • In Anhui Province, Xuanzhou City, one veterinary official was criticized for failing to shut down an illegal slaughterhouse and a second official issued false health certificates. 
  • On September 20, a farmer in Tongliao, Inner Mongolia allegedly bribed a veterinary official to issue a health certificate for 96 pigs transported from Tieling in Liaoning Province to a slaughterhouse in Hohhot, Inner Mongolia. Four of the pigs had symptoms and two died.
In addition to the ASF cases, officials in Chongqing discovered two truckloads of pigs infected with the Type-O foot and mouth disease (FMD) virus. On September 21, inspectors at a highway checkpoint in Chongqing found three pigs infected with Type-O FMD in a truck that originated in Guangdong Province's Maoming City, a 16-hour drive. The same day, officials at the checkpoint found an FMD-infected pig on a truck coming from Qujing in Yunnan Province, a 10-hour drive in a different direction. 

Sunday, October 7, 2018

Rural Revitalization With Chinese Characteristics

China's practice of draping a brightly decorated capitalist blanket over a socialist skeleton is evident in the Rural Revitalization Plan (2018-22) released September 26.


China's Rural Revitalization Plan aims to designate land for agricultural, residential, forest and ecological uses, upgrade infrastructure, housing, and farming, clean up pollution, protect the environment and create a scenic countryside.
The sprawling 36,000-character Plan is a little more than twice as long as the "Number 1 Document" that laid out the Rural Revitalization initiative earlier this year, yet this "Plan" includes a similar stream of general statements with few details and only a few minor new items. The Plan has great ambitions to overhaul the countryside--to make it richer, cleaner, more scenic, more ecologically balanced, and more closely integrated with cities.

In some ways the plan is similar to the 1958 "Peoples Communes" and the 1970s "Learn From Da Zhai" campaigns that also offered ambitious plans promising a modern, industrialized, idyllic and orderly countryside. This Plan digs up the bones from those earlier plans and will use them as the socialist skeleton for 21st-Century Rural Revitalization: village collectives, state farms, state-owned enterprises, supply and marketing cooperatives, rural credit cooperatives, model farms, and state-owned enterprises are all endorsed as core actors in this year's Revitalization. This time, a stream of pop-capitalist buzzwords learned from experts in Boston and Brussels are glued on the socialist skeleton: industrial parks, high-tech, "smart" farming, industry chains, alliances of companies and cooperatives, profit-sharing, innovation, multifunctionality, geographic indications, ecology, rural tourism, etc. All this is propped up by communist party arrangers and dealmakers and brought to life by a steady i.v.-drip of subsidies into the blood vessels.

The rural revitalization also includes a mash-up of Leninism and Chinese nationalism: there are exhortations to practice "socialist core values," strengthen "rural morality," revive rural culture, to respect the communist party and to respect parents.


Sixty years ago, the "Peoples Commune" movement offered a vision of an idyllic, carefully-ordered, self-sufficient rural community that included farming, grain storage, a militia, industry--many of the same principles in this year's "rural revitalization" plan.

The Plan is much broader than agriculture--it covers rural industry, tourism, sanitation, housing, ecological balance, rural governance, even rural culture, morality, integrity, and a "toilet revolution." But "food security" is declared as a "class one issue." The Plan aims to achieve a delicate balance of simultaneously opening the agricultural economy to the world while upgrading its domestic agricultural sector and forging links between farms, processors, input suppliers and service providers. The Plan's preamble says it presents great opportunities, but worries about prominent risks in international trade. Improving the competitiveness of China's agricultural products and strengthening risk management are identified as "urgent tasks."

The Plan calls for creating an open agricultural economy and improving international competitiveness of China's agricultural products. It includes an "action plan" to upgrade exports of specialty agricultural products. Specifically, it hopes to establish 300 or so specialized agricultural export regions and create a set of "China No. 1, World Famous" agricultural brands by 2020. The Plan aims to upgrade and expand the system of State Farms and turn them into globally competitive food conglomerates. Plans for an open economy include cooperation with "Belt and Road" countries and encouraging Chinese companies to invest in agriculture abroad. The Plan also hopes to boost China's R&D capacity in agricultural technology, set up S&T parks, technology-sharing platforms, and alliances to create world-leading agricultural technology companies.
The Dazhai Commune was the model for a campaign during the 1970s. It also envisioned an idealized vision of farms, housing, mechanization, water projects, and rural abundance.

"Risk management" items will tighten control over imported farm products. The Plan calls for improving biosecurity, strengthening border control, standardizing enforcement of animal and plant inspection and quarantine measures, and cracking down on smuggling of agricultural products.

At the core of the Plan is an exhortation to make massive investments in land that no one really owns. Opaque village collectives are to remain the main owners of rural land. Chronic problems of blurry property rights, disputed boundaries, absentee collective members, and de facto control by clans, business chieftains and criminal organizations will be cleared up. These organizations will be transformed into benevolent share-holding cooperatives that will lease out collective property to businesses infused with integrity and Confucian ethics, who will give villagers priority for jobs as hired hands, will generate a guaranteed fat stream of profits and distribute them to villager/shareholders.

Rural households are supposed to be the main participants in farming, but the plan calls for forming new-type agricultural businesses by carving out usage rights to farmland that can be consolidated and leased out to "family farms," farmer cooperatives, and agribusiness companies via rural land rights exchanges. Villagers' rights to land will be extended to give them more certainty about control of land. Banks will be cajoled into making loans to these new farming businesses on the basis of vague use rights to land they have sub-leased from the opaque collectives. Agribusinesses are expected to issue loan guarantees to banks on behalf of the farmers they purchase commodities from.

Business moguls are expected to invest in land that can only be used for the purpose prescribed by planners in the crazy quilt of zones laid out over the countryside. The plan calls for "scientifically delineating" space for urban, ecological, agricultural land use, and urban fringe development zones. There are "red lines" for protection of cultivated land, ecological protection, and coastal biological resources. No less than 103 million hectares of "permanent farmland" will be shielded from development by 2020. There will be 67 million hectares of "high-standard" fields by 2022.

An earlier 5-year plan's division of the country into seven major farm production regions and belts for specialization in 23 commodities is endorsed by the Revitalization Plan. The plan reiterates another plan to delineate zones where livestock and poultry are banned, limited, or encouraged that was introduced in the 2006 Livestock Law but ignored until 2013 when the communist party was embarrassed by 10,000 dead pigs floating into Shanghai's River. Land will be set aside for agricultural industry parks, science and technology parks, and innovation parks. Land will be designated for residential use, but villages will be consolidated. Small, marginal villages in areas with poor land and subject to "natural disasters" will be abandoned while important villages will be upgraded.

The plan regurgitates existing programs to use cropland more efficiently to achieve "a degree of self-sufficiency" by "stabilizing rice and wheat production," shifting land from corn to hay and minor grains in marginal regions, and coordinating development of livestock with fodder crops and pasture. The plan calls for firming up production in key cotton, oilseed, sugar, and rubber-producing regions. Exhortations to develop villages and towns specialized in particular commodities, developing brands, and improving quality and safety are not new. An industrialized aquaculture industry will gradually displace wild-catch fishing. For many initiatives the Plan relies on "model farms"--a mainstay of communism since the 1950s.

The plan envisions that China's farmers will need a steady intravenous drip of subsidies. The Plan promises to devise a mechanism to steadily increase government spending on agriculture. Fixed asset investment will be steered toward agriculture, including a set of major "foundational, long-term, influential" projects that will address weaknesses in agricultural infrastructure.

The Plan says subsidies will be better targeted, more precise, and "green." They will be steered toward the scaled-up "new-type" farmers. Subsidies will continue for shifting corn land to fodder crops, rotating corn with beans and minor grains, and setting up livestock farms to demonstrate the collection and utilization of waste. Machinery subsidies will be given for ecological equipment, large tractors, and other new priorities. One of the few new ideas is a promise of government policy support to help agribusinesses form profit-sharing links with farmers and possible government injections of funds into cooperatives and other organizations secured by cropland or forest property rights.

The corn reserve procurement system will be "improved" and subsidies for "marketized" purchasers of corn will be improved. The Plan also makes vague promises to "improve" or "rationalize" minimum prices for rice and wheat, subsidies for soybean, cotton, oilseeds, and sugar. It promises to reform state-owned grain enterprises, build up "backbone" enterprises, and attract new enterprises to the grain market. New initiatives include pilots for cost and income insurance for rice, wheat, and corn growers, and pilots for weather index, price index, and loan guarantee insurance.

Chinese leaders know they have taken on a tough task. They are attacking deep-seated problems that have led to atrophy of the countryside. In contrast to the frenzied campaigns of the 1950s and '70s, this plan's concluding text acknowledges that rural revitalization is long-term, difficult, and requires patience. The plan's authors anticipate that agricultural and rural modernization can be achieved by 2022 in developed coastal regions, the outskirts of big cities, and in villages with a strong collective economy. It might take until 2035 on the "main battlefield" on the outskirts of medium and small cities and small towns, villages on plains and hills. Efforts need to be focused precisely on the more difficult regions where modernization may not be achieved until 2050: old liberated areas, minority areas, border regions, and villages where it is difficult to consolidate fields.

Friday, September 28, 2018

Ag Minister Not Afraid of Trade Friction

China's strength in agriculture gives the country confidence to face trade friction, the country's ag minister said in an article posted on the communist party's Peoples Daily website today.

Minister Han Changfu said a sixth-straight 600-million-ton fall grain harvest is just 10 days away, providing food security "ballast." Han spent most of the article reciting improvements in farm policy, rural development, and ecological balance that give the economy "room to maneuver" against economic risks.

The only mention of the United States is a sentence citing a $16.4 billion agricultural trade deficit with the U.S. in 2017, but the trade war is in the background of the article. The main thrust if the remarks is to emphasize China's commitment to globalization in agriculture and the resilience of its rural economy in the ongoing trade war with the United States.

Han finished his remarks by touting China's rising degree of openness and international cooperation in agriculture. Citing statistics on remarkable growth in trade since joining the WTO in 2001, Han emphasized that China has become the largest agricultural importer and second-largest agricultural trading country. He noted that China is the largest buyer of soybeans, sugar, and cotton, and has become a target market for other countries. China has 120 agreements on agricultural cooperation with over 60 countries and international organizations, Han said. Through its "Belt and Road" initiative, China has made joint plans on cooperation, is sending agricultural experts abroad, and is building demonstration zones. China has invested $18 billion abroad in 100 countries during the last five years, Han said.

According to Han, China's strategy of utilizing both domestic and foreign resources and markets has helped China import what it needs, relieve pressure on stressed domestic resources, and stabilize supply.

According to Han, China will not provoke trade frictions, but is not afraid of trade friction either. Trade frictions pose challenges as well as opportunities and, "In this regard, we have plenty of enthusiasm and confidence," Han said.


Thursday, September 27, 2018

Food Safety Logo Replaced With Digital Code

China is replacing the "QS" food safety logo found on most food packages with a digital "SC" code as of October 1. The blue QS logo (stylized English letters signifying "Quality Safety") was introduced more than a decade ago to signify that food manufacturers had passed a food safety audit that was good for 3 years. Regulations introduced after enactment of the 2015 Food Safety Law called for the SC code to replace the QS logo.

"SC" represents the Chinese pinyin "Shengchan", or production, which identifies the licensed producer and its location. The code's 14 digits represent the food code, province, city, and county where it was produced, and a code for the company. The digital code is said to be better suited for digital traceability systems.

According to a journalist in Yangzhou, most of the packages carrying QS logos have already disappeared from stores as manufacturers phased out the symbol.
The blue QS logo (above) on China's food packages is replaced 
with a 14-digit "SC" code (below) as of October 1, 2018

Estimate: 500,000 Tons of Smuggled Pork Annually

Chinese customs officials say they are cracking down on "rampant" pork smuggling to prevent further spread of African swine fever and downward pressure on domestic pork prices. On August 24, Chinese coast guard officials apprehended a ship carrying over 300 metric tons of chicken feet, frozen pork, feet, ears, and tongues. Officials claim to have seized of 15,000 metric tons of meat in 6 meat smuggling cases from April 25 to May 25. 
Comic shows a stream of ants carrying loads of "smuggled zombie meat" through a tunnel into "China"
The article notes that meat smuggling is cyclical: it rises when Chinese pork prices are higher than foreign prices and falls when Chinese prices fall. The article estimates that smuggling of frozen pork and offal totals 500,000 metric tons in a normal year, but rises to over 1 million metric tons when prices are high. The article estimates that 100,000 live hogs are smuggled into the country annually. The article claims that smuggled pork has a "very bad" effect on Chinese pork prices.

Meat smuggling is mainly in Guangdong Province, Guangxi and Yunnan. Smuggling by boat is popular because it is easier to evade authorities, the article said. Smuggling of live hogs and cattle occurs mainly at two crossings from Vietnam into Guangxi Province, and some also occurs on the Yunnan border, the article said. Live hogs are transported to slaughter facilities in Jiangxi, Chongqing, and Hubei Provinces.
Diagram posted by a small city in Sichuan shows the supply chain for 
smuggled hogs from buyers in Vietnam to brokers and slaughterhouses in China.

Legal imports of pork and offal peaked at 1.6 million metric tons in 2016, then fell to 1.2 million metric tons in 2017. Legal importers include processing companies like Shuanghui, COFCO Meat, Jinluo, Yurun, Congpin, and Longda. In 2016, Shuanghui was the top legal importer, accounting for 19 percent of imports.
Truck smuggling pigs intercepted by authorities in Yunnan Province in 2016.

Tuesday, September 25, 2018

China Ag Imports Up...except for U.S. products

China's imports of most agricultural and food commodities have grown in the first 8 months of 2018, but imports from the United States fell sharply as retaliatory tariffs took effect July 6.

Since April, China's reporting of foreign trade data has been limited to a handful of monthly bulletins posted on the customs administration's web site. Piecing these together, it's possible to get a crude picture of how Chinese agricultural imports are faring during the "trade war" with the United States.

Approximating agricultural imports by adding up HS chapters 01-24 and 52 shows that China's imports of farm products from other countries was up about 16.5 percent year-on-year for January-August 2018, while imports from the U.S. were down 1.9 percent. The United States accounted for 18 percent of ag imports by this definition.
Soybeans are by far China's largest agricultural import, valued at $26.8 billion in January-August 2018. China imported 62 million metric tons of soybeans during January-August, about 1 mmt less than the same months in 2017. There was no drop-off as the 25-percent tariff on U.S. soybeans kicked in July 6. On the contrary, imports were up to 9.15 mmt in August. The customs data don't reveal which countries the August soybean imports came from, but Brazil was surely the predominant source.

China's grain imports surged during April and May, probably reflecting front-loading of shipments to get ahead of the U.S. tariffs. Grain imports were clearly down in July and August

Imports of U.S. grain fell to near-negligible amounts in July and August. Imports of fruit, nuts, dairy, meat and seafood from the U.S. also fell sharply.
 China's imports of U.S. alcohol have fallen, but imports of processed food, food preparations, meat and bone meal, fish meal and pet food have been more robust.

Imports of grains were down (except for corn), pork was down slightly, but China's imports of most major commodities were up sharply in the first eight months of 2018.

China imports of selected agricultural items, January-August 2017-2018


January-August total

Item
Unit
2017
2018
Percent change
Soybeans
MMT
63.3
62.0
-2.1





Cereal grains
MMT
17.96
16.41
-8.6
  Corn
MMT
2.03
2.87
41.4
  Sorghum
MMT
3.84
2.02
-47.4
  Barley
MMT
6.02
5.55
-7.8
  Wheat
MMT
3.18
2.23
-29.9
  Rice
MMT
2.68
2.02
-24.6





Cotton
1,000 MT
810
980
21.0
Edible oils
MMT
3.56
3.88
9.0
  Palm oil
MMT
1.88
2.16
14.9
  Rapeseed oil
MMT
0.58
0.83
43.1
  Soybean oil
MMT
0.51
0.29
-43.1





Seafood
1,000 MT
1,950
2,120
8.7
Meat and offal
1,000 MT
2,710
2,834
4.6
  Pork
1,000 MT
834
829
-0.6
  Beef
1,000 MT
456
638
40.1
  Poultry
1,000 MT
290
326
12.4
  Mutton
1,000 MT
176
227
29.0
Dairy products
1,000 MT
1,718
1,880
9.4
Fruit and nuts
1,000 MT
3,110
3,840
23.5
Alcohol,beverages
Mil. Liters
1,003
1,767
76.2